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FINRA Rule 3110

Rule Collection

Requires member firms to establish and maintain a system to supervise the activities of each associated person that is reasonably designed to achieve compliance with applicable rules and regulations.

Rule Overview

Jurisdiction: United States

Regulator: FINRA

Topic: Supervision

Overview
Rules in This Collection
Notable
Latest News
Further Reading

Written Supervisory Procedures or WSPs required under this rule underpin many key compliance requirements for firms required to adhere to FINRA rules.

Firms are required to amend their WSPs to reflect changes in applicable securities laws or regulations and are responsible for promptly communicating changes to all their associated persons.

In connection with electronic communications, firms must:

  • develop appropriate supervisory policies and procedures for the review of all business-related incoming, outgoing, and internal communications;
  • identify, review, and address incoming and outgoing comms containing customer complaints, instructions, funds and securities, and content of a subject matter that requires review under FINRA rules and securities laws;
  • identify and review internal communications of a subject matter that requires review under FINRA rules and securities laws, including: communications between research and non-research departments, communications with the public that require pre-approval, identification and reporting of customer complaints, and identification and prior written approval of account name changes or designations regarding customer orders;
  • conduct risk-based reviews to determine whether additional supervisory policies are necessary for their business;
  • capture, acknowledge, and respond to all written customer complaints;
  • educate and train employees on procedures governing correspondence, and log such training; and
  • maintain an audit trail and record of supervisory reviews
Rules in This Collection
FINRA Rule 3110 This Rule
FINRA Rule 3110.06
FINRA Rule 3110.19
Notable
Coming soon: FINRA’s residential supervisory location rule change

Coming soon: FINRA’s residential supervisory location rule change

New non-branch location will be subject to more stringent conditions and safeguards to ensure adequate continuing investor protection.

Thomas Hyrkiel, Julie DiMauro6 min read

FINRA censures and fines TD Private Client Wealth for failing to review 3.5m emails

FINRA censures and fines TD Private Client Wealth for failing to review 3.5m emails

Firm failed to maintain an appropriate supervisory system to review employee emails.

Julie DiMauro2 min read

SEC approves proposed rule change to FINRA Rule 3110

SEC approves proposed rule change to FINRA Rule 3110

Move allows more formal remote inspections in recognition of changed work environment.

Julie DiMauro1 min read

Latest News

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Further Reading

FINRA supervision of firms outline Go to https://www.finra.org/rules-guidance/key-topics/supervision FINRA reg notice 24-02 Go to https://www.finra.org/sites/default/files/2024-01/Regulatory_Notice_24-02.pdf FINRA reg notice 20-08 Go to https://www.finra.org/rules-guidance/notices/20-08 SIFMA comments on FINRA Rule 3110.19 Go to https://www.sifma.org/wp-content/uploads/2022/08/Proposed-Rule-Change-to-Adopt-Supplementary-Material-.19-under-FINRA-Rule-3110.pdf